Canadian regulator Konrad von Finckenstein illuminated what are the usually partisan public FCC hearings back in January and its worth reviewing what he said:
'We expect ISPs offering mobile broadband services to comply with our framework. If problems arise, we will review the regulatory measures that apply to them, or in other words we will lift or cut back the current exemption... Our decision on Internet traffic management practices was well received by all stakeholders: consumers, ISPs, technology companies and other interested groups. The decision came into effect 30 days after its release. ISPs have been disclosing their traffic management practices, as required by the decision. We will review their practices in response to any complaints we receive or if we consider it necessary.'
Also note a nice article on the growth of search neutrality ('Get Google'), tracing its progress via Andrew Odlyzko's 2008 paper - though ignoring Nico van Eijk's earlier work! Europe is across the water...
Speaking of which, I attended the 'Internet security and Internet freedom' seminar at Princeton organised by Stephen Schultze - great gathering, lots of great people including Rebecca MacKinnon, Ian Brown and Ethan Zuckerman. The keynote was by Alec Ross who had a Clinton first term circa 1994 title of 'Senior Advisor for Innovation' to Sec. Clinton. Alec made a lot of good points and is clearly a good guy in a still-authoritarian and 'war of terror' oriented administration. The killer final question to him was how come the administration doesn't practise what it preaches to others about Internet freedom and user rights online. Well...It led to to discussion of Skype and other good encrypted programmes used by dumb users (me) and with hacking attempts by dumb secret agents from evil governments. It made me realize again - yes the Vietnamese can hack their political opponents then throw bloggers in jail, yes the Ruskies can attack Estonia and Georgia but:
[1] we're not at cyberwar - its consultant-speak for outsource infosec and gimme me billions of dollars;
[2] the greatest weapon of freedom for hacktivists may be Tor, yet for ordinary people its Skype - so long as its backdoors only stay open in China...net neutrality is a POLITICAL issue of great merit there
Activists who work with North Korea, Vietnam and China then explained how you can't preach the First Amendment when no-one else cares about it, its Article 19 of the International Convention, which most of them have signed.
As a result, the pathetic political arm-twisting by the EC to enforce kiddie porn site blocking when they should focus everything on removing the websites, is depressing and results in China saying they are part of the global fight to censor the Internet, led by the EC...see Google's explanation of same.

Monday, April 26, 2010

The EU telecoms ministers declared in Granada their view of NGA access and the Digital Agenda, including:
"1. Take concrete steps to overcome the digital divide by meeting the target of 100% coverage of basic broadband to all citizens by 2013 and promote wide take-up of high speed broadband by 2020.

2. Provide a strong impulse to the roll out of competitive next generation high speed networks through promotion of competition between broadband providers and by implementing a predictable regulatory regime for the promotion of efficient investment in high speed broadband infrastructure and related services, based on swift implementation of the revised EU e-communication services framework.

3. Boost competition and financing of the networks of the future by encouraging efficient and sustainable private long term investments and providing public support for open networks where needed and appropriate.

4. Promote the rapid development of innovative digital wireless services and the adoption of the future EU radio spectrum policy programme, with the objective of an efficient use of radio spectrum.

5. Safeguard the openness of the internet through implementing and monitoring of the new EU electronic communications rules on network provision."

Note the commitment to openness!

UPDATE: this free market rant on behalf of the mobile sector (by an ex-Yankee Grouper now offering himself as 'expert witness' on behalf of mobiles) shows that operators are fearful of EC intervention (it is co-regulation not self-regulation that is proposed but the article is so littered with mistakes that we should not take anything in it as more than propaganda):'The European Parliament passed a telecoms reform package last November that favors self-regulation (sic) through competition and lays down minimal network neutrality conditions. Kroes has adopted this and says she welcomes consultations, but her threats are worrying. According to the Financial Times, she says she will not tolerate Internet service providers that restrict the speed of commercial websites and would take action if operators such as Telefonica and France Telecom demand payments in exchange for carrying bandwidth-guzzling services such as Google's YouTube.'

Friday, April 23, 2010

Enough of the European law and its willful misinterpretation in Washington - Beltway tangoing...
Here's an interesting proposition - Alcatel-Lucent is close to standardization of their VDSL2 specification, using vectoring and virtual bonding to squeeze up to 100Mb/s at 1km out of 2 copper pairs in lab conditions.
So maybe we can get up to 50Mb/s realistically from VDSL in semi-urban areas - that is FTTC which is cheapish to develop.
As I have been ploughing through Odlyzko's epic Railway Mania manuscript, which explains how much 1830s and 1840-45 railway development eventually made money for its investors, and that the entire 1825-50 railways boom entirely transformed first England (it was almost entirely concentrated there) and then the world, it has become clear that the 'beautiful illusion' that helped drive that investment by the 1850s into the valleys and mountains of England will not be reproduced by regulated monopolies today. So maybe VDSL2 will at least bridge some of the gap that irrationally exuberant markets are not noticeably keen to jump into!

Dear sir
I read with interest your guest op-ed 'How to Regulate the Internet Tap' April 20, 2010.
These eminent economists draw useful lessons in trying to achieve transparency and consumer information. However, they miss the essential regulatory message.
Europe's ISPs are now subject to new laws (Directives EC/2009/136 and EC/2009/140) that enforce transparency, force them to inform consumers and prevent their blocking Voice over Internet Protocol.
Your 'take-away' from the European experience should be that legislation at federal level backed by rigorous federal level oversight of state law enforcement is required to cope with ISP discriminatory and obfuscatory activities, even in the more competitive European market.
That this is to be achieved by what we in Europe call 'co-regulation' does not hide the hard law and harder regulatory will to enforce these measures in the consumer's best interest.
Sincerely
Christopher T. Marsden
Senior Lecturer in Communications Law
University of Essex

Wednesday, April 21, 2010

Its not surprising that a US duopolist would try to spin the Kroes speech, but this effort by AT&T on their blog seems to be very selective on her speech in Paris last week. I left a comment but they did not publish it (unsurprising really, and late publishing of comments generally avoids all readers). Here's what she really said.
The takeaway for the US is that you need legal authority via legislation to make net neutrality stick, and that you need federal judges who support decisive regulatory action to implement those measures. Oh, and as Lessig points out, you need broadband competition, and consumer rather than corporate welfare for your legislators. Without that you're stuck with misleading duopoly...
She has explained her policy further in a speech yesterday:
"It is therefore essential to establish clear regulatory guidelines to encourage investment in next generation access networks, while ensuring that such networks remain open and competitive in the interest of consumers... one could almost say that the only existing Digital Single Market for audiovisual material is the illegal one. People are able to access content EU wide but only through illegal file-sharing whereas much content from other Member States is not on offer at all. I am convinced that creating the legal Digital Single Market will lead to a wealth of options available to citizens. This will strike a blow against piracy to the benefit of authors and artists, and without endangering the open architecture that is essential for the internet's utility. It is obviously common sense that we fix problems like this."
Meanwhile, in the UK, David Cameron's office explains why you should only vote Conservative if you want lobbyists' version of the truth about broadband.
UPDATE: my comment has still not appeared on the AT&T blog, while some rather wonderful comms economists have picked up on the Kroes speech but spun it as very free-market - which it aint! - strange how legislative backing for net neutrality and a commitment to stop VOIP blocking are misinterpreted in DC...

Monday, April 19, 2010

Now this is freakish - not only would the LibDems repeal the DEAct parts that refer to blocking/disconnection - but the wife of their leader negotiated the WTO Basic Agreement on Telecoms (and formerly was a BT lawyer). A regulatory lawyer sleeping with a government minister? This is a GOOD thing.
Note to those from North America - the LibDems are the 3rd party in UK politics, but are suddenly tied for first in opinion polls 2 weeks before the General Election. They may form a government as minority partner to the two IT-clueless main parties.

User: Chris Marsden
Subject: Fido plans and options
Question:
Why are you increasing international text prices by 40% from 4 May? I am very interested in what economic justification there may be for such an enormous increase when international GSM costs are falling so fast.

Message.Web@fidomobile.ca

We would like to thank you for visiting our website.

We are sorry to learn of your dissatisfaction regarding the recent changes in pricing.

We must confirm that Fido regularly re-evaluates its rates to ensure they match market conditions.

The rate for pay-per-use text messages sent from Canada to another country (other than the United States) will indeed change to $0.35 per message plus applicable taxes. The rate for text messages to the United States will remain at $0.25 per message plus applicable taxes.

We offer various options that allow our customers to reduce their costs. The monthly plans of $35 and more offered since February 2010 include Unlimited International text messaging (sent from Canada).

For customers subscribing to monthly plans activated prior to this date, various international Text messaging options can added to their monthly services.

We currently offer four options:

25 international text messages for $4 per month.

50 international text messages for $7 per month.

250 international text messages for $10 per month.

500 international text messages for $15 per month.

We hope this adequately responds to your request.

-----Message d'origine-----

De : chris marsden

Envoyé : Tuesday, April 13, 2010 6:44 PM

À : Web Message

Objet : FW: Fido

You haven't answered the question - answer, please!

Dear Mr. Marsden,

We are truly sorry but no other information is available regarding the modification of our ratification.

Fido will regularly re-evaluates its rates to ensure they match the Canadian market conditions.

Wednesday, April 14, 2010

Some very interesting reports out today:
1. General Accounting Office in the US casts grave doubt on all published industry-backed data on counterfeiting and online piracy - pointing out that [a] copying is not 1:1 substitutable for sales losses - its sampling as Liam Gallagher pointed out; [b] disposable income is finite - people copying would not otherwise dip into non-existent savings to buy products.
This of course also applies to the rubbish data that BIS used for the Digital Economy Bill. Ofcom, please note.
2. Hong Kong's City Telecom offers 1GB/s symmetrical service for $26US - that rather punctures Ivan Seidenberg of Verizon's calumny that the US is ahead in broadband.
3. Lyddington in Rutland got fed up with VDSL delays by BT Openretch and decided to install its own fibre to the cabinet - at £185 per household if all subscribe. Ofcom had to poke BT to provide backhaul. So this tiny village has 40Mb/s - and other places in North Yorkshire, such as Newton-on-Rawcliffe have wireless broadband via the fibre-to-the-school model.Quote of the day - the mediaeval literature scholar turned telecoms strategy guru Olivia Garfield, BT Group Strategy Director, who is too young to remember BT's bullshit during both ISDN and ADSL roll-out, has responded to villages doing it for themselves by stating: "there is the risk of a local monopoly developing, which is never good for consumers."Shame on her.

Tuesday, April 13, 2010

The Commissioner is speaking at French regulator ARCEP, in a joint Franco-American seminar (Profs Wu, Shelanski, Noam, Rick Whitt from Google), speaking in English rather than the host's language. She is saying nothing of great interest, supporting greater transparency but being agnostic on non-discrimination. Euro-debate "still at an early stage". At least she is agreeing that its a very broad debate, wider than simply competition and innovation policy. But one wouldn't expect her to say much at this stage in the European debate. The stream is excellent quality with 3 camera angles, running smoothly - would it if FT throttled streaming video?
UPDATE: official text available.
She does admit that universal service will be affected by net neutrality, and the consultation on Next Generation Access. On transparency: 'Too many consumers currently feel cheated when they get much lower Internet speeds than advertised'. This leads to 'these are not issues up for discussion, but they are clear rules...I will be vigilant to ensure they are correctly transposed and implemented.'
She finally announces that she will have a public consultation launched "before summer" - expect July.
Her analogy to Dutch road networks is interesting - more rules can slow traffic just because of the presence of regulation: 'I'm not a police officer in search of a busy corner'
She makes her first two principles freedom of expression and transparency - 'crystal clear'. But then she goes on to suggest competition may well solve the problem, but that traffic management must be objective and clear or it will be discriminatory. 'Discrimination against VoIP competitors will not be allowed'.
I did not hear her say 'mobile' - anyone?

And now for a little extracurricular detour from (the usual) net neutrality, with a venture into app neutrality. I was struck by the recent reports of Apple's revising of the License Agreement for software developers on the iPhone, iPad, or iPod Touch platform. The most striking modification reads:

3.3.1 — Applications may only use Documented APIs in the manner prescribed by Apple and must not use or call any private APIs. Applications must be originally written in Objective-C, C, C++, or JavaScript as executed by the iPhone OS WebKit engine, and only code written in C, C++, and Objective-C may compile and directly link against the Documented APIs (e.g., Applications that link to Documented APIs through an intermediary translation or compatibility layer or tool are prohibited). [Italics added]

This amounts to a explicit boycott of—most visibly—Actionscript, the programming language for Adobe Flash. Apple's distaste for Flash has long been latent, and it's by no means a coincidence that Flash support has always been absent for iPhone or iPod Touch. Apple's change of the License Agreement comes at a time when Adobe is about to launch the latest iteration of its flagship software package CS, including the option to develop iPhone/iPad/iPod Touch apps using flash—again, what a coincidence.

Now, at a time when most online video runs on Flash, it is rather annoying not to have access to the Daily Show episodes on my iPhone. Besides my personal annoyance, Apple's boycott also chains software developers, and seems to have a negative effect on Flash's market position. Which begs the question: can we (myself, app developers, Adobe) turn to (European) law to do something about this? Short answer (SPOILER ALERT): unlikely so.

There are a number of possible approaches to this issue under EU law. As both Apple and Adobe are established in Europe, EU law can be invoked. The obvious approach would be European antitrust law, mainly art. 102 of the EU Treaty. It seems as if art. 102(c) is applicable in this case for instance, as Apple indeed seems to be "applying dissimilar conditions to equivalent transactions with other trading parties, thereby placing them at a competitive disadvantage." For art. 102 to apply, Apple and Adobe need not be direct competitors—which they are not at this point. Rather, abuse of dominance over potential competitors also suffices. However, under an art. 102 procedure a situation of dominance needs to be established first, which is calculated by a process of market definition. I don't want to bore anyone with the details on EU market definition (here), but bear in mind that product markets, geographic markets and temporal quality are factored in. A plausible relevant market in this case for instance would be the European market for mobile operating systems.

Case law has not established a golden rule of what constitutes dominance on a market once defined, but generally speaking anything over 40% is in trouble. Now, clearly Apple does not hold a market share of over 40%, either as a mobile OS or as a phone manufacturer. Therefore it would become hard to argue an art. 102 violation by Apple, as dominance cannot be established. Moreover, let's not forget that this case appears to concern a two-sided market: Apple functions as a platform serving both app developers and end-users. This complicates the process of market definition even further.

Let's for the sake of argument assume that Apple were dominant on the Mobile OS market. This would open up the realms of Refusal to Supply case law—as Apple would refuse to Adobe supplying flash products to end-users on its products. The ECJ has been rather strict in refusal to supply cases, and has struck down hard on firms dominant firms refusing to supply, like Commercial Solvents and United Brands. It's only in very few cases that plaintiffs in refusal cases have successfully argued for objective justifications of their conduct—Apple's rebuttal that refusing Flash will "result in sub-standard apps" and "hinder the progress of [Apple's] Mobile platform" are unlikely to hold up.

So refusal to supply would stand a chance, if Apple were in fact be dominant on the defined market for this hypothetical case—which it is likely not. So much for EU antitrust.

Next: what about European harmonizing regulation, like the telecoms Framework and the eCommerce Directive? About the telecoms framework I can be short: it does not cover content, only telecommunications on the network level. For the eCommerce directive it is the other way round: it does exclusively cover "information society services" (content), yet doesn't affect apps much—or Apple for that matter. Moreover, it is highly unlikely that a patchy Directive like eCommerce can be directly invoked by (legal) persons in a private law suit. Forgive me for not going into the details of direct effect of Directives, it's a long story.

Now please tell me if I've overlooked something, but it seems as if Apple will get a pass for its conduct under EU law. There is the fundamental rights route, with the EU Charter of Fundamental Rights codifying the freedom "to receive and impart information and ideas without interference by public authority and regardless of frontiers" (art 11). This would be a long shot though: not only would it be a hard case to make for a claimant that Apple is completely preventing app developers (or Adobe) to receive and impart information, such claims have also only rarely been upheld in private suits.

So EU law seems to be exhausted, but is this really a problem? When following a Chicago School rationale, it seems we shouldn't be too bothered with Apple's conduct. If it hampers innovation and is inefficient, even as a monopolist it will attract entry by competitors who do allow all API's on mobile app platforms. The problem with this Chicago approach is that it doesn't take network effects into account. There has in fact been a lot of entry in the mobile app field, think of Android Market. But app developers want to be where all other apps are: the amount of participants on a network increases its value for all. The Apple app store features thousands of apps, which makes it most attractive for developers to write apps for the Apple platform. Compare that with the about 800 apps currently available on Window's app Marketplace.

Apple is well aware of this situation, and naturally wants to keep it that way. So even though Apple and Adobe are not directly competing, Apple has much incentive to foreclose Adobe on its platform. As Joe Wilcox correctly remarks, flash offers developers a way around the app store—a flash platform through a browser. Apple doesn't want this of course, as the app store (1) increases the value of the iPhone/iPad/iPod Touch for consumers, and (2) generates a lot of revenue for Apple.

Concluding: it is perfectly clear why Apple is foreclosing on Adobe, Apple's conduct is likely to have an anti-competitive effect, yet European law stands idle. This re-enforces Jonathan Zittrain's call for API neutrality. The walled garden that Apple is building works very well as a stand-alone platform, in which hardware and a rich suite of software are perfectly integrated. This is satisfying to consumers (like myself), and profitable for Apple. However, in the long run walled gardens hinder innovation in a way almost similar to state planning: it adds a layer of control and bureaucracy to what otherwise would be free floating innovation by software developers.

DISCLAIMER: this is a purely (legal) theoretical point, and very much work in progress. I'm still looking into economic studies and empirical work. Please comment!

Monday, April 12, 2010

I am beginning to really like this Commissioner - her blog (updated somewhat sporadically but with an update in Easter week, no mean feat in Brussels) has become active, and she has highlighted by video an FP7 project on sharing media across mobile and fixed platforms, in which she states:
'aPSV Eindhoven fan who has stayed at home to babysit his young sister can see a goal of a star like Ola Toivonen on the TV screen and feel the emotion at the stadium thanks to the videos sent by his friends, also displayed on the TV screen.'Hallelujah! IPR and remix culture, anyone?

After last week's Comcast decision by the DC Circuit, I reported to have heard through the grapevine that the FCC was seriously considering to move broadband back to Title II of the Communications Act.

The F.C.C. has the legal authority to change the label [to Title II], as long as it can provide a good reason. And that reason is obvious: Americans buy an Internet access service based on its speed and price — and not on whether an e-mail address is included as part of a bundle. The commission should state its case, relabel high-speed Internet access as a “telecommunications service,” and take back the power to protect American consumers.

This is quite significant. Crawford wouldn't be writing about this if the FCC didn't want to build momentum for a Title II push. My bet: things will start moving soon, maybe even before the August recess.

Sunday, April 11, 2010

Its been quite a week in the UK, with the Digital Economy (sic) Act 2010 being passed in what was not democracy's finest 2 hours. Its worth noting that this will come back as secondary legislation requiring affirmative resolution of both Houses of parliament, and in the meantime, Ofcom gets to sit down with ISPs, record companies AND consumers (?) to discuss details.
A last word, then, for the great Liam Gallagher, a 100% rock star, who reminds us that non-commercial downloading is recording from the radio for the 2000s:"Downloading's the same as what I used to do - I used to tape the charts of the songs I liked (from the radio). I don't mind it. I hate all these big, silly rock stars who moan - at least they're f**king downloading your music, you c**t, and paying attention, know what I mean? You should f**king appreciate that - what are you moaning about? You've got f**king five big houses, so shut up."Amen.

Saturday, April 10, 2010

The magnificent Rebecca McKinnon told Congress that Chinese Internet censorship included 280,000 trolls aiming to 'bamboo wash' (my phrase) any critique of China's policies, and how the process is co-regulatory:
"why merely block or filter content when you can delete it from the Internet entirely? In Anglo-European legal parlance, the legal mechanism used to implement such a system is called “intermediary liability.” The Chinese government calls it “self-discipline,” but it amounts to the same thing, and it is precisely the legal mechanism through which Google’s Chinese search engine, Google.cn, was required to censor its search results. Internet companies operating within Chinese jurisdiction – domestic or foreign – are held liable for everything appearing on their search engines, blogging platforms, and social networking services. They are also legally responsible for
everything their users discuss or organize through chat clients and messaging services. In this way, much of the censorship and surveillance work is delegated and outsourced by the government to the private sector."
Even in Europe with our filtering, blocking and 3Strikes (digital inquisition, anyone?), we're not there yet.